More and more people are carrying less and less cash, that is a huge mistake

Corporate America is making it easier and easier to walk around with only a card in your pocket. For customers, it is convenient: no trips to the ATM to get a coffee, no worries about getting mugged. For Corporate America (and the Government as well), it means that you are a much richer data-mining target and more likely to spend more. For thieves it means that it is ever easier to steal your identity. For the rest of us, it means waiting for ages while you write your check or swipe your card to pay for a $.25 newspaper.

I’m not advocating that everyone carry around $1000 in cash all the time, that would be stupid. Credit cards have their purposes. However, I think that Americans are getting far too dependent on them for the little things. I think that this is part of the reason why our consumer debt is at record levels. If you have cash in your pocket, you are aware of how much money you are spending on a very visceral level. If spending $100 or $5 involves the exact same transaction, It is doubtful that you think so much about how the amounts you are spending are adding up.

Every time you use a credit card, or club card, or any cash substitute, you create a record in a database. This record will let someone know what you spent, when you spent it and what you spent it on. As these records pile up, corporations (and government) can create a fairly accurate profile of you and your interests. Corporations want this information so that they can more directly sell to you (I’m open-minded enough to acknowledge that this may not be a bad thing, ie: Amazon’s recommendations). Government wants this information so that they can track their citizens and maybe look for evil-doers (depending on your level of trust in the government, this may or may not be a bad thing, I think it is a scary thing given this government). Each one of these records also makes it easier for someone to steal your identity. These records are stored and replicated all over the place. A thief only has to find a single unsecured database to get your personal information.

Now you can ignore my warnings and do whatever the heck you want. This is a free country. Here is my final argument: sometimes it is just plain rude. When you write a check or use a card, you waste time. It is slower than cash. It is always slower than cash. Making a line of people wait while you write out a check and then fill in your register is just rude. Ditto for swiping your card and waiting while the card reader connects to the system and prints out the receipt. Again, I understand this in a grocery line where you are spending a lot of money. I can’t stand this at my local coffee shop, and I can’t tell you how many times I’ve seen it.

Of course, the government is planning to add RFID tags to cash soon so a lot of the privacy arguments for cash will go away…